The voluntary private pension scheme
12 March 2013.
Since December 1993, there has been legal provision in Hungary for the setting up of voluntary pension funds. The aim is to establish an organized framework for voluntary pre-savings to future pension supplements. Such savings are usually supported by employers and supplemented from their own resources. Fund members are entitled to claim tax relief on payments made to a voluntary fund, recorded in the members’ individual accounts. Employers may pay a monthly sum equivalent to the minimum wage on behalf of fund members, supported with tax allowances.
The number of voluntary pension funds and members has seen a dynamic growth and by 1999 there had already been around 250 funds in operation. According to data of March 2012, this number has fallen to 55 due to the concentration process. However, the number of members was 1.245 million i.e. 32.3% of the total number of insured people have had voluntary funded savings. Their assets have exceeded HUF 82 billion.